**Exhibit 10.1**ASSET PURCHASE AGREEMENTbetweenWestwind Communications L.L.C.as Seller,andFisher Broadcasting Companyas BuyerAugust 3, 2007
 

 
Table of Contents         ARTICLE I. ASSETS BEING SOLD AND PURCHASED AND PURCHASE PRICE  1   1.1 Assets  1   1.2 Excluded Assets  3   1.3 Liabilities  4   1.4 Escrow Deposit  5   1.5 Purchase Price, Payment; Allocation of Purchase Price  5   1.6 Prorations and Adjustments to the Purchase Price  5   1.7 Collection of Accounts Receivable  8   1.8 Additional Fees  9          ARTICLE II CLOSING AND CLOSING DELIVERIES  9   2.1 Closing  9   2.2 Closing Deliveries  10          ARTICLE III REPRESENTATIONS AND WARRANTIES OF SELLER  12   3.1 Good Standing  12   3.2 Right, Power and Authority  12   3.3 No Conflicts or Defaults  13   3.4 Broker’s Fee  13   3.5 FCC Licenses and Other Authorizations  13   3.6 Seller Qualifications  14   3.7 Title to Assets; Sufficiency of Assets  14   3.8 No Litigation; Compliance with Law  15   3.9 Intellectual Property  15   3.10 Contracts  15   3.11 Insurance  16   3.12 Condition of Assets  16   3.13 Required Consents  16   3.14 Employee Benefits  16   3.15 Employment and Labor Matters  17   3.16 Taxes  18   3.17 Reports  18   3.18 Financial Statements  18   3.19 Real Property  18   3.20 Environmental Laws and Regulations  20   3.21 Accounts Payable  20   3.22 MVPD Matters  21   3.23 No Changes  21   3.24 Affiliation Agreements  22   3.25 Related Party Transactions  22   3.26 Non-FCC Authorizations  22   3.27 Disclaimer  23 
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           3.28 Ring-Fencing of Specific Warranties  23          ARTICLE IV REPRESENTATIONS AND WARRANTIES OF BUYER  23   4.1 Good Standing  23   4.2 Right, Power and Authority  23   4.3 Buyer Qualifications  24   4.4 No Conflicts or Defaults  24   4.5 No Litigation or Violations of Law  24   4.6 Required Consents  24   4.7 Broker’s Fee  25          ARTICLE V COVENANTS  25   5.1 FCC Approval  25   5.2 Cooperation  26   5.3 Risk of Loss  26   5.4 Written Consents and Certain Other Documents  27   5.5 Notifications  28   5.6 Allocation of Purchase Price  29   5.7 Control of the Stations  29   5.8 Inspection Rights  29   5.9 No Changes  29   5.10 Preservation of Books and Records  32   5.11 Construction and Updating of Schedules  32   5.12 Employees  33   5.13 Title Insurance; Surveys; Lien Search; Real Property Inspection  35   5.14 Exclusivity  36   5.15 WARN Act  36   5.16 Environmental Study  36          ARTICLE VI CONDITIONS PRECEDENT TO THE OBLIGATION OF BUYER TO CLOSE  37   6.1 Conditions  37   6.2 Challenges  38   6.3 No Order  38   6.4 Closing Deliveries  38          ARTICLE VII CONDITIONS PRECEDENT TO THE OBLIGATION OF SELLER TO CLOSE  38   7.1 Conditions  38   7.2 No Challenges  39   7.3 No Order  39   7.4 Closing Deliveries  39          ARTICLE VIII RIGHTS OF BUYER AND SELLER UPON TERMINATION OR BREACH  39   8.1 Termination  39   8.2 Effect of Termination  40 
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           8.3 Limitation on Damages  40   8.4 Attorneys’ Fees and Costs  41          ARTICLE IX INDEMNIFICATION  41   9.1 Survival  41   9.2 Indemnification by Seller  42   9.3 Indemnification by Buyer  42   9.4 Indemnification Procedure  43   9.5 Limitation on Indemnification Obligations  45   9.6 Indemnification is Exclusive Remedy  45   9.7 Indemnification Escrow Deposit  45          ARTICLE X MISCELLANEOUS  46   10.1 Respective Costs  46   10.2 Rules of Interpretation  46   10.3 Entire Understanding  47   10.4 Confidentiality  47   10.5 Further Assurances  48   10.6 Headings  48   10.7 Counterparts  48   10.8 Choice of Law  48   10.9 Benefit and Binding Effect  48   10.10 Notices  48   10.11 No Third-Party Beneficiaries  50   10.12 Contract Consents/Benefit  50   10.13 Bulk Sales  50   10.14 FCC Licenses  50          EXHIBIT A — Defined Terms   A1 EXHIBIT B — Legal Opinion Matters   B1 EXHIBIT C — Form of Consulting Agreement for Peter Desnoes   C1 EXHIBIT D — Form of Consulting Agreement for Wayne Lansche  D1 DISCLOSURE SCHEDULES
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**ASSET PURCHASE AGREEMENT**     This Asset Purchase Agreement (this “Agreement”) is made and entered into as of this3rd day of August, 2007 (the “Effective Date”), by and among Westwind CommunicationsL.L.C., a Delaware limited liability company (“Seller”), and Fisher Broadcasting Company, aWashington corporation (“Buyer”).**RECITALS**          A. Seller holds the licenses, permits, approvals, and authorizations, and applicationstherefor (collectively, the “FCC Licenses”) issued by the Federal Communications Commission(the “FCC”) for the operation of television station KBAK-TV, Bakersfield, California andClass A Television Station KBFX-CA, Bakersfield, California (each a “Station” andcollectively, the “Stations”) and owns or leases certain other assets used in connectionwith the operation of the Stations;          B. Seller desires to sell and transfer to Buyer the Assets (as defined in Section 1.1), andBuyer desires to purchase and acquire the Assets from Seller and assume the Assumed Obligations (asdefined in Section 1.3) for the consideration and upon the terms and conditions herein provided,subject to FCC approval; and          C. Capitalized terms in this Agreement shall have the meaning set forth in Exhibit Ahereto or as otherwise defined herein;          NOW, THEREFORE, in consideration of the mutual covenants, agreements, representations, andwarranties contained in this Agreement, the parties hereto, intending to be legally bound, dohereby agree as follows:**ARTICLE I****ASSETS BEING SOLD AND PURCHASED AND PURCHASE PRICE**          **1.1****Assets**. Upon the terms and subject to the conditions set forth in this Agreement,Seller hereby agrees to sell, assign, convey, transfer, and deliver to Buyer at the Closing, andBuyer hereby agrees to purchase at the Closing, free and clear of all Liens (other than PermittedLiens), all of Seller’s right, title, and interest in and to the following tangible and intangibleassets (except as expressly provided in Section 1.2 hereof) (collectively, the “Assets”):          (a) the FCC Licenses and all other licenses, permits, approvals, concessions, franchises,consents, qualifications, registrations, and authorizations, if any, issued by the FAA, anyother regulatory agency, or any Governmental Authority that are required or useful inconnection with the ownership and operation of the Stations, as are set forth in Schedule1.1(a) hereto, and all applications therefor, together with any renewals, extensions ormodifications thereof and additions thereto (collectively, and including the FCC Licenses, the“Authorizations”);          (b) the Transmission Equipment, Transmission Structures, Towers, antenna system, cables,furnishings and fixtures, equipment, electrical devices, machinery,
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tools, furniture,computers, telecommunications equipment, Central IT Resources, office equipment and supplies,vehicles, inventories of supplies, tapes, including recorded commercials and programming,spare parts, and other tangible assets or personal property of every kind and description usedor useful primarily in the operation of the Station Business, including that set forth inSchedule 1.1(b) hereto (collectively, the “Tangible Personal Property”), plussuch additions thereto and minus such deletions therefrom as are permitted by the provisionsof this Agreement;          (c) all Contracts relating to the Stations and Station Business, including, withoutlimitation, those Contracts listed on Schedule 1.1(c) hereto and any additionalContracts relating to the Stations and Station Business executed and delivered, if written, orentered into orally, if oral, by Seller between the date hereof and the Closing Date in theordinary course of business of operating the Stations consistent with past practice(collectively, the “Assumed Contracts”);          (d) all program and programming materials and elements of whatever form or nature ownedby Seller and used in connection with the Stations and Station Business, whether recorded ontape or any other media or intended for live performance, and whether completed or inproduction, and all call signs or call letters used with respect to the Stations, including“KBAK-TV,” “KBFX-LP” and “KBFX-CA,” and all trade names, trademarks, service marks,copyrights, and patents (registered or unregistered, and including applications and licensestherefor), trade secrets, universal resource locators, Internet domain names and websiteaddresses (including any and all common law rights, applications, registrations, extensionsand renewals relating thereto) owned, used or held for use by Seller in connection with theStation Business, as listed and described in Schedule 1.1(d) hereto, and anylogograms, jingles, slogans and other intangible personal property associated therewith(“Transferred Intellectual Property”), together with the goodwill associatedtherewith;          (e) the Owned Real Property and the Leased Real Property (collectively, the “RealProperty”), and the Contracts granting Seller the right of use or occupancy of any portionof the Leased Real Property, or any Contract to which Seller is a party and granting any otherPerson the right of use or occupancy of any portion of the Owned Real Property, together withany amendments, modifications or supplements thereto (each a “Lease” and collectively,the “Leases”);          (f) all books, files, and records contained in printed or digital documentation or othertangible material relating to the Assets or the operation of the Stations, includingproprietary information, schematics, technical information and engineering data, machinery andequipment warranties, surveys, maps, rights touse telephone numbers, as-built drawings and other drawings, blueprints, plans,engineering data and processes developed or acquired by Seller, programming information,customer lists and files, advertising and programming purchase and sales records and othersales and traffic information, correspondence, advertising records, market data andinformation relating to the Stations’ markets, files, literature, copies of all titleinsurance policies and underlying title documents for the Real Property, copies of allenvironmental reports, copies of the Assumed Contracts, and the FCC required logs, files, andrecords, including the
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Stations’ complete public inspection file, but not including anycorporate or accounting books or records of Seller which do not relate to the operation of theStations or the Assets, or which relate to Seller’s past or current income tax returns orliabilities;          (g) warranties covering Tangible Personal Property to the extent transferable by theSeller;          (h) all advance payments, if any, to Seller by advertisers for advertising that would runon the Stations after the Closing Date and any other advance payments by third parties forservices to be provided by or for the Stations after the Closing Date;          (i) except (i) as set forth in Section 1.2, (ii) for claims relating to Taxes for periodsprior to the Closing Date, or (iii) for reimbursement of payments already made by Seller, allclaims, counterclaims, credits, causes of action, choses in action, rights of recovery, andrights of indemnification or setoff against third parties and other claims arising out of orrelating to the Station Business, the Assets or the Assumed Obligations and all otherintangible property rights which primarily relate to the operation of the Stations, theAssets, or the Assumed Obligations;          (j) all security deposits held by or on behalf of Seller as lessor under any lease; and          (k) all other assets reflected on the balance sheet as of December 31, 2006 included inthe Financial Statements, with such additions and subtractions thereto as are necessary toreflect acquisitions and dispositions, as appropriate, made in the ordinary course of businessof operating the Stations from December 31, 2006 through the Closing Date.          **1.2****Excluded Assets**. Notwithstanding anything to the contrary contained in thisAgreement, the Assets do not include, and Seller shall not, and is not hereby agreeing to, sell,assign, transfer, deliver, or convey to Buyer (a) any assets not expressly set forth in Section 1.1above; (b) other than the amounts described in Section 1.1(h), cash and cash equivalents on hand oron deposit in banks (including, without limitation, certificates of deposit, commercial paper,treasury bills, and money market accounts), marketable securities, or inter-company orinter-affiliate accounts, and any similar accounts, (c) all Accounts Receivable; (d) any and allprepayments, deposits, claims for refunds and prepaid expenses relating to the Station Business,the Assets, or the Assumed Obligations (including deposits on leasehold interests and utilities, prepaid taxes and insurance premiums (except as provided inSection 1.1(j) above)), to the extent such prepayments are not the subject of a prorationadjustment as provided herein or Seller is not otherwise reimbursed at Closing; (e) any and allinsurance policies and contracts of insurance, and proceeds or refunds therefrom; (f) any and allpromissory notes, bonds, letters of credit, certificates of deposit, receivables on account, andany other similar items, and any cash surrender value in regard thereto; (g) any assets of anypension, profit-sharing, or employee benefit plans, including Seller’s interest in any welfareplan, pension plan, or benefit arrangement; (h) all Tax Returns and supporting materials, allfinancial statements and supporting materials, all books and records that Seller is required by lawto retain, and all records of Seller relating to the sale of the Assets; (i) any interest in and toany refunds or overpayments
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of Taxes for periods prior to the Closing Date; (j) any Contract otherthan the Assumed Contracts; (k) originals of the books and records necessary to enable Seller tofile its Tax Returns and reports; (l) all tangible and intangible personal property within theAssets disposed of or consumed in the ordinary course of business consistent with the pastpractices of Seller, and the terms and conditions of this Agreement, between the Effective Date andthe Closing Date; (m) the name “Westwind” as used on or in any intangible assets; (n) subject toSection 5.9 of this Agreement, all Assumed Contracts that have terminated or expired prior to theClosing Date in the ordinary course of business consistent with the past practices of Seller, andthe terms and conditions of this Agreement; (o) Seller’s organizational documents and agreements,minute books, limited liability company records and other books and records that pertain to theinternal matters of Seller; (p) any of the rights of Seller under this Agreement and the otheragreements, certificates and documents delivered in connection herewith; (q) all claims forcopyright royalties for broadcasts prior to the Closing Date and other claims for refunds of moniespaid to a Governmental Authority prior to the Closing Date; and (r) refunds, claims for refund orcharge backs with respect to commissions paid by Seller prior to the Closing Date (together(a)-(r), the “Excluded Assets”).          **1.3****Liabilities**.          (a) The Assets shall be sold and conveyed to Buyer by instruments of conveyance in a formreasonably satisfactory to Buyer and in accord with such forms as are customarily used forsuch purposes under the laws of the State of California and free and clear of all mortgages,liens, deeds of trust, security interests, pledges, restrictions, prior assignments, charges,claims, and encumbrances of any kind or type whatsoever (collectively, “Liens”) exceptfor those Liens set forth on Schedule 1.3(a) (the “Permitted Liens”).          (b) Upon the terms and subject to the conditions set forth in this Agreement, Buyerhereby agrees to as of the Closing Date assume and agree to pay for, satisfy, discharge,perform and fulfill insofar as they relate to the time period on and after the Closing Dateand arise out of events occurring on or after the Closing Date, as and when due (i) all theobligations and liabilities of Seller under the Assumed Contracts (including all programmingobligations to the extent the contractual payments are due after the Closing Date and allobligations and liabilities of Seller under the employment and compensation agreements listedon Schedule 1.1(c)) and the Authorizations; (ii) any liability or obligation to aTransferred Employee (other than under any Employee Benefit Plan, except as otherwisecontemplated by Section 5.12); (iii) any liability or obligation arising out of anylitigation, proceeding or claim by any person or entity relating to the Assets or theStations; (iv) any severance or other liability arising out of the termination of anyTransferred Employee or any other employee’s employment with Buyer; (v) all Accounts Payable;and (vi) all other obligations and liabilities arising out of Buyer’s ownership of or rightsin and to the Assets or the operation of the Stations; provided, that Buyer shall also assumeand agree to pay for, satisfy, discharge, perform and fulfill those obligations andliabilities of Buyer set forth in Section 5.12 (collectively, the “AssumedObligations”).          (c) Other than the Assumed Obligations, Buyer shall not assume or be liable for, and doesnot undertake to assume or discharge: (i) any liability or obligation of
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Seller arising out ofor relating to any Contract or Lease; (ii) any liability or obligation of Seller arising outof or relating to any Employee Benefit Plan or otherwise relating to employment, including butnot limited to wages, salaries, vacation pay, payroll taxes, COBRA coverage or severancepayments (except as otherwise contemplated by Section 5.12); (iii) any liability or obligationof Seller arising out of or relating to any litigation, proceeding or claim (whether or notsuch litigation, proceeding or claim is pending, threatened or asserted before, on or afterthe Closing Date); (iii) any liability or obligation of Seller arising out of that certainTolling Agreement between Seller and the FCC effective June 14, 2007 with respect to the FCCLicenses of KBAK-TV; (iv) any other liabilities, obligations, debts or commitments of Sellerwhatsoever, whether accrued now or hereafter, whether fixed or contingent, whether known orunknown; (v) all Accounts Payable; or (vi) any claims asserted against Seller, any Affiliateof Seller, the Stations or any of the Assets based on or arising out of any event (whether actor omission) occurring prior to the Closing Date including, without limitation, the payment ofall Taxes (collectively, the “Excluded Liabilities”).          **1.4****Escrow Deposit**. Upon the execution of this Agreement, Buyer shall deliver toUnited Bankshares, Inc. (the “Escrow Agent”) the sum of Two Million Seven Hundred FiftyThousand Dollars ($2,750,000) by wire transfer of immediately available funds (the “EscrowDeposit”). The Escrow Deposit shall be held by the Escrow Agent in an interest bearing accountin accordance with the terms of the Escrow Agreement. In the event of a termination of thisAgreement, the Escrow Deposit shall be distributed as provided in the Escrow Agreement. In theevent of a Closing, subject to Sections 8.2(b) and 8.2(c), (i) One Million Dollars ($1,000,000) ofthe Escrow Deposit shall continue to be held by the Escrow Agent (the “Indemnification EscrowDeposit”) and disbursed in accordance with the Escrow Agreement and Section 9.7 below, (ii) theIndemnification Escrow Deposit shall be applied as a credit against the Purchase Price and anyinterest earned on the Escrow Deposit shall be paid to Seller in accordance with the EscrowAgreement, and (iii) One Million Seven Hundred Fifty Thousand Dollars ($1,750,000) of the EscrowDeposit (the “Closing Escrow Deposit”) shall be paid to Seller at Closing in accordancewith Section 1.5(b) hereof and the Escrow Agreement.          **1.5****Purchase Price, Payment; Allocation of Purchase Price**.          (a) Upon the terms and subject to the conditions set forth in this Agreement, and inconsideration for the sale, assignment, conveyance, transfer, bargain, and delivery of theAssets to Buyer pursuant to the terms hereof, the purchase price hereunder (the “PurchasePrice”) shall be Fifty-Five Million Dollars ($55,000,000).          (b) At Closing, (i) the Closing Escrow Deposit shall be delivered by Escrow Agent toSeller in cash by wire transfer of immediately available U.S. funds to an account designatedby Seller, (ii) the balance of the cash portion of the Purchase Price in excess of the EscrowDeposit, subject to the adjustments described in Section 1.6 to be made as of the ClosingDate, shall be delivered by Buyer to Seller by wire transfer of immediately available U.S.funds to an account designated by Seller.          **1.6****Prorations and Adjustments to the Purchase Price**.
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          (a) All prepaid revenue, prepaid expenses, accrued income and accrued expenses of theStations as of 12:01 A.M. local Bakersfield time, on the Closing Date (the “EffectiveTime”) shall, except as otherwise expressly provided herein, be adjusted and allocatedbetween Seller and Buyer to reflect the principle that all revenue, income and expensesarising from the operation of the Stations or relating to the Assets before the Effective Timeshall be for the account of Seller, and all revenue, income and expenses arising from theoperation of the Stations or relating to the Assets from and after the Effective Time shall befor the account of Buyer. Anything to the contrary in this Agreement notwithstanding: (i)payments for program rights shall be pro-rated or adjusted based on the value of the programsor the percentage of runs of a program performed under any program rights agreement, includingthose monthly payments for the month in which the Closing Date, and (ii) FCC regulatory fees(not including filing fees related to the FCC Applications) shall be prorated based upon thetime during the FCC fiscal year during which each of Buyer and Seller held the FCC Licenses.Any adjustments or prorations made under this Section 1.6 shall be treated as a reduction orincrease in the Purchase Price, as applicable.          (b) Such prorations shall include all ad valorem and other property taxes, utilityexpenses, liabilities and obligations under Assumed Contracts, rents and similar prepaid anddeferred items and all other expenses and obligations, such as deferred revenue andprepayments, attributable to the ownership and operation of the Stations that straddle theperiods before and after the Effective Time. To the extent not known, real estate and personalproperty taxes shall be apportioned on the basis of taxes assessed for the preceding year,with a reapportionment as soon as the new tax rate and valuation can be ascertained even ifsuch is ascertained after the Adjustment Amount is finally determined. Any and all agencycommissions that are subject to adjustment after the Effective Timebased on revenue, volume of business done or services rendered in part before the Effective Timeand in part on or after the Effective Time shall be borne by Seller and Buyer ratably inproportion to the revenue, volume of business done or services rendered, as the case may be,by each with respect to the Stations during the applicable period.          (c) To the extent not inconsistent with the express provisions of this Agreement, theallocations and prorations made pursuant to this Section 1.6 shall be made in accordance withGAAP.          (d) No later than five (5) Business Days prior to the scheduled Closing Date, Sellershall prepare in good faith and deliver to Buyer a statement setting forth Seller’s estimateof the net amount by which the Purchase Price is to be increased or decreased in accordancewith Sections 1.6(a), (b) and (c) of this Agreement as of the Closing (the “AdjustmentAmount”) together with a schedule setting forth the pro rata adjustments of assets andliabilities required as of the Effective Time, in reasonable detail, and the componentsthereof (the “Preliminary Adjustment Statement”). If the Adjustment Amount reflectedon the Preliminary Adjustment Statement is a credit to Buyer, then the Purchase Price payableat Closing shall be reduced by the amount of the preliminary Adjustment Amount, and if theAdjustment Amount reflected on the Preliminary Adjustment Statement is a charge to Buyer, thenthe Purchase Price payable at Closing shall be increased by the amount of such preliminaryAdjustment Amount. For a period of ninety
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(90) days after Closing, Buyer and its auditors andSeller and its auditors may review the Preliminary Adjustment Statement and the related booksand records of Seller with respect to the Stations, and Buyer and Seller will in good faithseek to reach agreement on the final Adjustment Amount. If agreement is reached within such90-day period, then promptly thereafter Seller shall pay to Buyer or Buyer shall pay toSeller, as the case may be, an amount equal to the difference between (i) the agreedAdjustment Amount and (ii) the preliminary Adjustment Amount indicated in the PreliminaryAdjustment Statement. If agreement is not reached within such 90-day period, then the disputeresolution provisions of Section 1.6(e) shall apply.          (e) If the parties do not reach an agreement on the Adjustment Amount within the 90-dayperiod specified in Section 1.6(d), then Buyer and Seller shall submit to Ernst & Young (the“Accounting Firm”) for review and resolution by the Accounting Firm any and allmatters directly relating to the computation of the Adjustment Amount that remain in dispute;provided, however, that the Accounting Firm shall not resolve any issues relating to theinterpretation of this Agreement or any other legal issues. Within sixty (60) days after theend of such 90-day-period, Buyer and Seller shall submit their respective positions to theAccounting Firm, in writing, together with any other materials relied upon in support of theirrespective positions. Buyer and Seller shall make available to the Accounting Firm any booksand records and work papers relevant to the preparation of the Accounting Firm’s computationof the Adjustment Amount. Buyer and Seller shall use reasonable efforts to cause theAccounting Firm to render a decision resolving such matters in dispute within thirty (30) daysfollowing the submission of such materials to the Accounting Firm and, upon completion of itsreview, to inform the parties in writing of its own determination of the Adjustment Amount and the basis for its determination.Any determination by the Accounting Firm in accordance with this Section shall be final andbinding on the parties. Within five (5) calendar days after the Accounting Firm delivers tothe parties its written determination of the Adjustment Amount, Seller shall pay to Buyer, orBuyer shall pay to Seller, as the case may be, an amount equal to the difference between (i)the Adjustment Amount as determined by the Accounting Firm and (ii) the preliminary AdjustmentAmount indicated in the Preliminary Adjustment Statement.          (f) Buyer and Seller agree that judgment may be entered upon the determination of theAccounting Firm in any court having jurisdiction over the party against which suchdetermination is to be enforced. Except as specified in the following sentence, the cost ofany arbitration (including the fees and expenses of the Accounting Firm) pursuant to thisSection 1.6 shall be borne equally by Buyer on the one hand and Seller on the other hand. Thefees and expenses (if any) of Buyer’s independent auditors and attorneys incurred inconnection with the review of the Preliminary Adjustment Statement and related books andrecords shall be borne by Buyer, and the fees and expenses (if any) of Seller’s independentauditors and attorneys incurred in connection with their review of the Preliminary AdjustmentStatement and related books and records shall be borne by Seller.          (g) With respect to Contracts in effect as of the Closing Date under which Seller hasagreed to provide commercial advertising time on the Stations after the Closing Date inexchange for property or services in lieu of, or in addition to, cash (“TradeAgreements”), the parties shall make an adjustment to reflect the difference between (A)the
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value, as of the Closing Date, of all advertising time required to be broadcast by theStations after the Closing Date pursuant to the terms and subject to the conditions of theTrade Agreements, and (B) the value of all property or services to be received by the Stationsafter the Closing plus all property or services received by the Station before the Closing tothe extent included in the Assets pursuant to the terms and subject to the conditions of theTrade Agreements. To the extent that the amount described in the foregoing clause (A) exceedsthe amount described in the foregoing clause (B) by an amount that is greater than TenThousand Dollars ($10,000), the Purchase Price shall be adjusted downward by the amount inexcess of Ten Thousand Dollars ($10,000); in the event that the amount described in clause (A)exceeds the amount described in the clause (B) by an amount that is equal to or less than TenThousand Dollars ($10,000), such amounts are equal or the amount described in clause (A) isless than clause (B), there shall be no adjustment under this paragraph in respect of TradeAgreements. From and after the Closing Date, Buyer shall be entitled to all goods andservices to be provided to the Stations after the Closing Date under the Trade Agreements.Substantially all of the Trade Agreements as of the date hereof are listed on Schedule1.6(g) hereto. Buyer shall, as additional consideration, fully assume, perform, dischargeand be fully responsible for all obligations under Trade Agreements.          **1.7****Collection of Accounts Receivable**.          (a) At the Closing, Seller shall designate Buyer, by means of a mutually acceptable agencyagreement, as its agent solely for purposes of collecting on behalf of Seller the AccountsReceivable. Seller shall deliver to Buyer, on or after the Closing Date, a complete and detailedstatement of the Accounts Receivable. Buyer shall use commercially reasonable efforts to collectthe Accounts Receivable during the period (the “Collection Period”) beginning at theEffective Time and ending one hundred twenty (120) days following the Closing Date consistent withSeller’s customary practices for collection of its accounts receivables; provided, however, thatsuch efforts shall not include hiring attorneys or collection agencies to collect such AccountsReceivable. Any payment received by Buyer (i) at any time following the Effective Time, (ii) froma customer of a Station after the Effective Time that was also a customer of that Station prior tothe Effective Time and that is obligated with respect to any Accounts Receivable and (iii) that isnot designated as a payment of a particular invoice or invoices or as a security deposit or otherprepayment, shall be presumptively applied to the accounts receivable for such customer outstandingfor the longest amount of time and, if such accounts receivable shall be an Accounts Receivable,remitted to Seller in accordance with Section 1.7(b); provided further, however, that if, prior tothe Effective Time, Seller or, after the Effective Time, Seller or Buyer received or receives awritten notice of dispute from a customer with respect to an Accounts Receivable that has not beenresolved, then Buyer shall apply any payments from such customer to such customer’s oldest,non-disputed accounts receivable, whether or not an Accounts Receivable. Buyer shall obtain theprior written approval of Seller before referring any of the Accounts Receivable to a collectionagency or to an attorney for collection. Except as otherwise provided herein, Buyer shall incur noliability to Seller for any uncollected Accounts Receivable. During the Collection Period, neitherSeller nor any of its agents, without the consent of Buyer shall make any direct solicitation ofany customers owing the Accounts Receivable for collection purposes.
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          (b) On or before the fifth (5th) day following the end of each calendar month in theCollection Period, Buyer shall deposit into an account identified by Seller at the time of Closingthe amounts collected during the preceding month of the Collection Period with respect to theAccounts Receivable. Buyer shall furnish Seller with a list of the amounts collected during suchcalendar month and in any prior calendar months with respect to the Accounts Receivable and aschedule of the amount remaining outstanding under each particular account. Seller shall beentitled during the sixty-day period following the Collection Period to inspect, copy and audit therecords maintained by Buyer pursuant to this Section 1.7, upon reasonable advance notice.          (c) Following the expiration of the Collection Period, Buyer shall have no further obligationsunder this Section 1.7, except that Buyer shall immediately pay over to Seller any amountssubsequently paid to it with respect to any Accounts Receivable. Following the Collection Period,Seller may pursue collections of all the Accounts Receivable, and Buyer shall deliver to Seller allfiles, records, notes and anyother materials relating to the Accounts Receivable and shall otherwise cooperate with Sellerfor the purpose of collecting any outstanding Accounts Receivable.          **1.8****Additional Fees**. Buyer shall bear any and all sales and use taxes arising out ofthe transactions contemplated by this Agreement, including any applicable “bulk sales” tax. Buyershall bear any transfer, conveyance, recordation and filing fees, taxes or assessments, includingfees in connection with the conveyance of real property and the recordation of instruments relatedthereto, applicable to, imposed upon, or arising out of the sale, assignment, conveyance, andtransfer to Buyer of the Assets as contemplated by this Agreement, provided, however, that Sellershall pay the fees, if any, for properly documenting and recording the release of any liens on theAssets and all income taxes based upon gain realized by Seller as a result of the sale of theAssets. All fees, charges and expenses of any title company retained by Buyer to provide one ormore commitments or policies of title insurance for the benefit of Buyer or any of its Affiliatesor otherwise arising in connection with the issuance of any commitment or policy of title insurancefor the benefit of Buyer or any of its Affiliates shall be borne solely by Buyer. Buyer and Sellershall bear equally all of the FCC filing fees incurred in connection with the AssignmentApplications.**ARTICLE II****CLOSING AND CLOSING DELIVERIES**          **2.1****Closing**. The term “Closing” as used herein shall refer to the actualconveyance, transfer, assignment, and delivery of the Assets to Buyer in exchange for the paymentto Seller by Buyer of the consideration payable pursuant to Section 1.5 hereof on the Closing Date,and shall be deemed effective as of 12:01 a.m. Eastern Standard Time on the Closing Date. TheClosing shall take place at such place and hour as shall be mutually agreed upon by Buyer andSeller or the Closing may be conducted by mail or courier delivery of documents executed incounterparts; provided, however, that the Closing shall be held ten (10) BusinessDays after the date on which the FCC Consent has become a Final Order or January 8, 2008,whichever is later (such date referred to herein as the “Closing Date”), in either case
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subject to the satisfaction or waiver of the other conditions set forth in Articles VI and VII ofthis Agreement.          **2.2****Closing Deliveries**.     (a) At the Closing, Seller shall deliver (or cause to be delivered) to Buyer thefollowing documents and instruments of conveyance and assignment, in each case reasonablysatisfactory in form and substance to Buyer and its counsel and duly executed by Seller orsuch other signatory as may be required by the nature of the document:          (i) grant deeds in recordable form effective to vest in Buyer good and marketable feesimple title to all parcels of the Owned Real Property, in each case free and clear of allLiens (other than Permitted Liens);          (ii) duly executed bills of sale, certificates of title, endorsements, assignments,consents and other good and sufficient instruments of sale, conveyance, transfer andassignment sufficient to sell, convey, transfer and assign the Authorizations, the TangiblePersonal Property, the Assumed Contracts and the other Assets to Buyer free and clear ofany Liens (other than Permitted Liens) and to quiet Buyer’s title thereto;          (iii) certified copies of the required consents or resolutions of the directors,members, managers, and/or partners of Seller (or a committee thereof duly authorized),authorizing the execution, delivery and performance by Seller of the transactionscontemplated by this Agreement, and certification that such consents or resolutions wereduly adopted at a duly convened meeting of the directors, members, managers, or partners orcommittee, at which a quorum was present and acting throughout or by unanimous writtenconsent, and that such consents or resolutions remain in full force and effect, and havenot been amended, rescinded or modified, except to the extent attached thereto;          (iv) a certificate, dated as of the Closing Date, executed by an officer of Sellercertifying (A) that the representations and warranties of Seller contained in thisAgreement are true and correct in all respects (in the case of any representation orwarranty containing any materiality qualification) or in all material respects (in the caseof any representation or warranty without any materiality qualification) on and as of theClosing Date, except for changes contemplated by this Agreement and except forrepresentations and warranties expressly made solely as of a prior date; and (B) thatSeller has, in all material respects, performed all of its obligations and complied withall of its covenants set forth in this Agreement to be performed and complied with by itprior to or on the Closing Date;          (v) subject to the provisions of Section 1.2 hereof, copies of all Authorizations,Assumed Contracts, blueprints, schematics, working drawings, plans, projections,statistics, engineering records, and all files and records regarding the Assets and used bySeller in connection with the Assets and the Station’s operations;
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          (vi) a certificate from the appropriate governmental officials of (A) Delaware as tothe good standing of Seller and (B) California as to the good standing as a foreign entityof Seller;          (vii) all Consents that Seller has been able to obtain pursuant to this Agreement;          (viii) to the extent not previously transferred, the files, records and otherinformation referenced in Section 1.1(f);          (ix) a certification signed by Seller to the effect that Seller or, if Seller is anentity disregarded as separate from another entity for federal income tax purposes, suchother entity is not a “foreign person” as defined in Section 1445 of the Code;          (x) an opinion (or opinions) of Seller’s counsel and Seller’s communications counsel,as applicable, dated as of the Closing Date, covering the matters set forth ExhibitB, subject to customary qualifications, limitations, exceptions and assumptions;          (xi) Consulting Agreements in the form of Exhibits C and D hereto executed by PeterDesnoes and Wayne Lansche, respectively; and          (xii) such other documents to be delivered by Seller as are reasonably necessary toeffectuate and document the transactions contemplated herein.          (b) At the Closing, Buyer shall deliver (or cause to be delivered) to Seller thefollowing documents and instruments of conveyance and assignment, in each case reasonablysatisfactory in form and substance to Seller and its counsel and duly executed by Buyer orsuch other signatory as may be required by the nature of the document:          (i) the Purchase Price, which shall be paid in the manner specified in Section 1.5;          (ii) an instrument or instruments of assumption of the Authorizations, the AssumedContracts, and the other Assumed Obligations to be assumed by Buyer pursuant to thisAgreement;          (iii) a certificate, dated as of the Closing Date, executed by an officer of Buyer,certifying that (A) the representations and warranties of Buyer contained in this Agreementare true and correct in all respects (in the case of any representation or warrantycontaining any materiality qualification) or in all material respects (in the case of anyrepresentation or warranty without any materiality qualification) on and as of the ClosingDate, except for changes contemplated by this Agreement and except for representations andwarranties expressly made as of a prior date; and (B) Buyer has, in all material respects,performed all of its obligations and complied with all of its covenants set forth in thisAgreement to be performed and complied with by it prior to or on the Closing Date;
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          (iv) certificates from the appropriate governmental officials of (A) Washington as tothe good standing of Buyer and (B) California as to the good standing as a foreign entity ofBuyer;          (v) certified copies of the required consents or resolutions of the directors, members,managers, stockholders or partners of Buyer, (or a committee thereof duly authorized),authorizing the execution, delivery and performance by Buyer of the transactionscontemplated by this Agreement, and certification that such consents or resolutions wereduly adopted at a duly convened meeting of the directors, members, managers, or partners orcommittee, at which a quorum was present and acting throughout or by unanimous writtenconsent, and that such consents or resolutions remain in full force and effect, and have notbeen amended, rescinded or modified, except to the extent attached thereto;          (vi) Consulting Agreements in the form of Exhibits C and D hereto executed by Buyer;and          (vii) such other documents to be delivered by Buyer hereunder as are reasonablynecessary to effectuate and document the transactions contemplated herein.**ARTICLE III**